Whiting to buy Williston Basin assets for $260 mln

BenFox

Whiting Petroleum Corp.
WLL, +0.50%
agreed to acquire some producing oil and gas wells and development acreage in North Dakota and Montana for $260 million in a deal with a private party, increasing its property in the Williston Basin, a key growth area for the exploration-and-production company.

"This acreage expands our presence in our Western Williston Basin area where we have seen recent strong production growth primarily as a result of positive drilling results at our Hidden Bench, Tarpon and Missouri Breaks prospects," Chief Executive James J. Volker said.

The deal, expected to close by Sept. 30, will be financed with borrowing under its existing bank credit facility.

The properties, in Williams and McKenzie counties of North Dakota and Roosevelt and Richland counties of Montana, primarily target the Middle Bakken and Three Forks zones and include 17,282 net acres located in and around Whiting's acreage in the Missouri Breaks and Hidden Bench prospects in its Western Williston Basin area.

The properties include 13 operated 1,280-acre Bakken/Three Forks drilling spacing units with an average working interest of 58% and net revenue interest of 48%.

Net oil and gas production from the properties is estimated to average 2,420 barrels of oil equivalent per day this month. Whiting estimates proved reserves at 17.1 million barrels of oil equivalent with 85% of reserves being oil.

Whiting's results have been boosted in recent quarters by higher oil prices and generally rising production, leading to revenue growth in recent years. Last month, the company closed on the sale of some oil fields assets primarily located in the Oklahoma Panhandle for about $860 million to BreitBurn Energy Partners LP (BBEP).

Also last month, the company said its second-quarter profit slid as its prior-year results had higher derivative gains, though production and prices in the latest period jumped.

Shares closed Monday at $50.85 and were inactive premarket. The stock is up 17% so far this year.

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